When it comes to health, you go for a medical checkup to see if
you're physically fit. The medical report will tell everything about your
health.

But when it comes to wealth, it's as important that you do a
regular checkup for your financial health. You need to know where you are
financially before you decide what you want to achieve financially.

What do you do to ascertain your level of financial fitness?

You can use financial statements to determine your financial
fitness. They are income statements and balance sheets.

It sounded boring and alien to me when I first prepared my
income statement and balance sheet. The process is tedious as you need to dig
out things and get them organized in a proper format.

But I can tell you once you've done this checkup, you'll have a
clear picture where you stand financially and you can take the necessary
measures to achieve financial freedom.

Besides that you'll be more in control of your money and know
how to spend your money wisely.

Let's get started to determine your financial fitness.

---------------- Income Statement ----------------

First, you can prepare an income statement. An income statement
is also called profit and loss statement. An income statement consists of two
sections: monthly income and expenses.

Your income would probably comprise salary, rent from real
estate, dividends from stocks and bonds, interests from savings accounts, and
royalties.